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A study on the impact of
             implementation of TQM in
             Malaysia Engineering Firm.


                             Chan Chee Mang
                                TP021569
                            BM040-3-2-RESM
                     Lecturer: Benjamin Chan Yin Fah



13/10/2011                                             1
Introduction
Subject
• Starting from 1980s, TQM (Total Quality Management)- a new concept
    evolved and was strongly influenced by Japanese manufacturers.
• TQM has positive effects on a firm’s performance and productivity through the
    involvement of all levels of the organisation.
• For past 20 years, quite number of authors focused on the TQM soft factors
    and its dimension.
• TQM is not only a program but a way of business management-comprehensive
    management philosophy which provides continuous improvement to all
    organisation’s functions.




 13/10/2011                                                                2
Introduction Cont.
             Object
             • Critical success of implementation of
               TQM soft factors in an engineering
               firm-process improvement, zero defect
               mentality, employee
               empowerment, open
               organisation, increased
               training, benchmarking, closer supplier
               relationship, closer customer
               relationship, adoption and
               communication, committed leadership.
13/10/2011
               (Powell, 1995)                            3
Introduction Cont.
Linkage
• Examine a comprehensive framework for TQM soft factors.
  The proposed TQM model for an engineering firm located
  in Malaysia.
• Explore the positive correlation between the degree of
  implementation of TQM basing on quality practices that
  implemented and corresponding productivity index.
• Introduction of soft factor elements which affect the TQM
  implementation whereby to prioritise the factors with
  interrelationships.
   13/10/2011                                          4
Problem Statement
TQM as a managerial philosophy that
become a need for any organisation to
outperform over competitors.
Is the implementation of TQM has a
positive effects on engineering firm’s
productivity?

  13/10/2011                             5
Research Objectives
• To examine the feasibility of implementing TQM in an
  organisation.
• To determine the level of soft factors.
• To identify the positivity or negativity correlation of the 10
  Soft factors with the Respondent demographic factors.
• To identify the Top 3 implemented Soft Factors and the
  least 3.




   13/10/2011                                                6
Research Hypothesis
H1. Process Improvement has a positive correlation on firm’s productivity.
H2. Zero Defect Mentality has a positive correlation on firm’s productivity.
H3. Employee Empowerment has a positive correlation on firm’s productivity.
H4. Open Organisation has a positive correlation on firm’s productivity.
H5. Increased Training has a positive correlation on firm’s productivity.
H6. Benchmarking has a positive correlation on firm’s productivity.
H7. Closer Supplier Relationship has a positive correlation on firm’s productivity.
H8. Closer Customer Relationship has a positive correlation on firm’s productivity.
H9. Adoption and Communication has a positive correlation on firm’s productivity.
H10. Committed Leadership has a positive correlation on firm’s productivity.




    13/10/2011                                                                    7
Significance of study
• Clearly showing the correlation of soft factors implemented
  in firm.
• The imply of the soft factors.
• Training is not much correlated to other factors.
• Leadership has the highest value among the soft factors.
• The addressed factors have been designed and distributed
  in organisation as the enablers of improving effectiveness
  of TQM.



   13/10/2011                                            8
Limitation of Study
The proposed framework is
• Costly and
• Time consuming due to large number of questions
  hold.
• Possibility in which these subdivisions do not have
  the same relative importance weight.
• Limits to one company only. (findings should not
  be generalised)


  13/10/2011                                       9
Terminology Definition
       Terms                                            Conceptual                                  Operational



Committed Leadership   Successful implementation of TQM requires effective changes in an
                       organisation’s culture and it is somehow impossible without management
                       leadership (Ho et al., 1999).

Adoption and           Communication plays a vital role in efficient producing high quality
Communication          products (Schloss, 2003).

Closer Customer        For continuous improvement, customer requirements must be consistently
Relationship           measured and satisfied. The firm should be organised to obtain the needed
                       customer database, and reliable comments on product or service quality
                       levels (Forza & Filippini, 1998).


Benchmarking           Benchmarking is a continuous process of comparing an organisation’s
                       products, services, and processes against those of its best competitors or
                       industry leaders (Ghobadian & Woo, 1996).

Increased Training     Training of employees is crucial for building the human capital of the
                       organisation (Black and Porter, 1996)

Open Organisation      Also known as teamwork. Teams should have authority to implement the
                       changes and motivate employees to involve in the processes (Gonzalez-
      13/10/2011       Benito & Martin-Lorente, 1999)                                                     10
Terminology Definition Cont.
   Terms                              Conceptual                          Operational


Employee         Empowerment is an integral part of any successful
Empowerment      quality improvement process which helps employees
                 to make decisions about their own work and
                 environment (McQuater et al., 1995)
Zero-Defect      Quality programs should measure the percentage or
Mentality        the number of parts that deviate from acceptable items
                 in order to prevent the recurrence of a defect
                 (Motwani, 2001).
Process          The key aspect in TQM programs (Sinclair & Zairi,
Improvement      1995).
                 The reduction or elimination of variance (Deming,
                 1986).



    13/10/2011                                                                  11
Research Framework
Respondent Profile
Age
Tenure in present      10 Soft Factors
occupation             Process Improvement
Education level        Zero Defect Mentality
Gender                 Employee Empowerment
Specialisation Field   Open Organisation
                                                Company annual
Manager Status         Increased Training
                                                   report 2010
                       Benchmarking
                                               Ratio of total annual
                       Closer Supplier
Company Profile                                 output out of total
                       Relationship
History &                                          annual cost.
                       Adoption and
Background             Communication
Involvement of         Closer Customer
Industry               Relationship
Market Scope/Work      Committed Leadership
scope (PESTLE)


         Input             Throughput                Output
13/10/2011                                                        12
Organisation of study
     • Chapter 1
     Description of the various contents in which the problem statement
     and objective.
     • Chapter2
     Literature review Independent Variables and Dependent Variables.
     • Chapter3
     Research design and data analysis
     • Chapter 4
     Result of the study.
     • Chapter5
     Conclusion, implications, limitations and recommendations.



13/10/2011                                                                13
Thank you for listening.




13/10/2011                              14

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A study on the impact of implementation of (2)

  • 1. A study on the impact of implementation of TQM in Malaysia Engineering Firm. Chan Chee Mang TP021569 BM040-3-2-RESM Lecturer: Benjamin Chan Yin Fah 13/10/2011 1
  • 2. Introduction Subject • Starting from 1980s, TQM (Total Quality Management)- a new concept evolved and was strongly influenced by Japanese manufacturers. • TQM has positive effects on a firm’s performance and productivity through the involvement of all levels of the organisation. • For past 20 years, quite number of authors focused on the TQM soft factors and its dimension. • TQM is not only a program but a way of business management-comprehensive management philosophy which provides continuous improvement to all organisation’s functions. 13/10/2011 2
  • 3. Introduction Cont. Object • Critical success of implementation of TQM soft factors in an engineering firm-process improvement, zero defect mentality, employee empowerment, open organisation, increased training, benchmarking, closer supplier relationship, closer customer relationship, adoption and communication, committed leadership. 13/10/2011 (Powell, 1995) 3
  • 4. Introduction Cont. Linkage • Examine a comprehensive framework for TQM soft factors. The proposed TQM model for an engineering firm located in Malaysia. • Explore the positive correlation between the degree of implementation of TQM basing on quality practices that implemented and corresponding productivity index. • Introduction of soft factor elements which affect the TQM implementation whereby to prioritise the factors with interrelationships. 13/10/2011 4
  • 5. Problem Statement TQM as a managerial philosophy that become a need for any organisation to outperform over competitors. Is the implementation of TQM has a positive effects on engineering firm’s productivity? 13/10/2011 5
  • 6. Research Objectives • To examine the feasibility of implementing TQM in an organisation. • To determine the level of soft factors. • To identify the positivity or negativity correlation of the 10 Soft factors with the Respondent demographic factors. • To identify the Top 3 implemented Soft Factors and the least 3. 13/10/2011 6
  • 7. Research Hypothesis H1. Process Improvement has a positive correlation on firm’s productivity. H2. Zero Defect Mentality has a positive correlation on firm’s productivity. H3. Employee Empowerment has a positive correlation on firm’s productivity. H4. Open Organisation has a positive correlation on firm’s productivity. H5. Increased Training has a positive correlation on firm’s productivity. H6. Benchmarking has a positive correlation on firm’s productivity. H7. Closer Supplier Relationship has a positive correlation on firm’s productivity. H8. Closer Customer Relationship has a positive correlation on firm’s productivity. H9. Adoption and Communication has a positive correlation on firm’s productivity. H10. Committed Leadership has a positive correlation on firm’s productivity. 13/10/2011 7
  • 8. Significance of study • Clearly showing the correlation of soft factors implemented in firm. • The imply of the soft factors. • Training is not much correlated to other factors. • Leadership has the highest value among the soft factors. • The addressed factors have been designed and distributed in organisation as the enablers of improving effectiveness of TQM. 13/10/2011 8
  • 9. Limitation of Study The proposed framework is • Costly and • Time consuming due to large number of questions hold. • Possibility in which these subdivisions do not have the same relative importance weight. • Limits to one company only. (findings should not be generalised) 13/10/2011 9
  • 10. Terminology Definition Terms Conceptual Operational Committed Leadership Successful implementation of TQM requires effective changes in an organisation’s culture and it is somehow impossible without management leadership (Ho et al., 1999). Adoption and Communication plays a vital role in efficient producing high quality Communication products (Schloss, 2003). Closer Customer For continuous improvement, customer requirements must be consistently Relationship measured and satisfied. The firm should be organised to obtain the needed customer database, and reliable comments on product or service quality levels (Forza & Filippini, 1998). Benchmarking Benchmarking is a continuous process of comparing an organisation’s products, services, and processes against those of its best competitors or industry leaders (Ghobadian & Woo, 1996). Increased Training Training of employees is crucial for building the human capital of the organisation (Black and Porter, 1996) Open Organisation Also known as teamwork. Teams should have authority to implement the changes and motivate employees to involve in the processes (Gonzalez- 13/10/2011 Benito & Martin-Lorente, 1999) 10
  • 11. Terminology Definition Cont. Terms Conceptual Operational Employee Empowerment is an integral part of any successful Empowerment quality improvement process which helps employees to make decisions about their own work and environment (McQuater et al., 1995) Zero-Defect Quality programs should measure the percentage or Mentality the number of parts that deviate from acceptable items in order to prevent the recurrence of a defect (Motwani, 2001). Process The key aspect in TQM programs (Sinclair & Zairi, Improvement 1995). The reduction or elimination of variance (Deming, 1986). 13/10/2011 11
  • 12. Research Framework Respondent Profile Age Tenure in present 10 Soft Factors occupation Process Improvement Education level Zero Defect Mentality Gender Employee Empowerment Specialisation Field Open Organisation Company annual Manager Status Increased Training report 2010 Benchmarking Ratio of total annual Closer Supplier Company Profile output out of total Relationship History & annual cost. Adoption and Background Communication Involvement of Closer Customer Industry Relationship Market Scope/Work Committed Leadership scope (PESTLE) Input Throughput Output 13/10/2011 12
  • 13. Organisation of study • Chapter 1 Description of the various contents in which the problem statement and objective. • Chapter2 Literature review Independent Variables and Dependent Variables. • Chapter3 Research design and data analysis • Chapter 4 Result of the study. • Chapter5 Conclusion, implications, limitations and recommendations. 13/10/2011 13
  • 14. Thank you for listening. 13/10/2011 14